Legalities of 'Raffling' off house

callaway92

Seeing this is a growing trend now (and in my eyes a worrying one).

Often seeing them in articles by the Indo online or Joe.ie and the likes with 'Stunning 4 bed house could be yours for just €10'

Example Here

and here

and this one saying they're doing it for the people to give hope to purchasers of a raffle ticket haha

Don't know what else to say on the topic on my end other than I don't like the trend at all (stems from R Kings etc doing so well I suppose). These guys in the article above giving a slice to Beaumont on the back of what would be an almighty profit if it hit the full ticket sales for example and using Beaumont as a scummy tactic imo, all in the name of a massive mark-up on the house price.

AnRothar

The idea of a raffle to "sell" something is not new.
Equally holding a raffle to raise funds for a worthwhile cause is an old concept.
Once the legalities are complied with of course.

Most raffles need a hook to generate interest community/charity/mega prize etc.

There have been several raffles with a house as the top prize run by sporting organisations specifically to raise funds for the club/organisation.
The sporting organisations typically charge €100 and a "low" number of tickets(usually less than 1000).

The ones you have linked there is a large number of tickets needing to be sold.

Then again €10 is about 4 takeaway coffees.
And I could have a holiday home in Donegal.

I suspect the mentioned charities would gratefully appreciate any funds raised.
Also they are clearly stating that PART of the funds will go to charity not all.

listermint

callaway92 wrote: »

Seeing this is a growing trend now (and in my eyes a worrying one).

Often seeing them in articles by the Indo online or Joe.ie and the likes with 'Stunning 4 bed house could be yours for just €10'

Example Here

and here

and this one saying they're doing it for the people to give hope to purchasers of a raffle ticket haha

Don't know what else to say on the topic on my end other than I don't like the trend at all (stems from R Kings etc doing so well I suppose). These guys in the article above giving a slice to Beaumont on the back of what would be an almighty profit if it hit the full ticket sales for example and using Beaumont as a scummy tactic imo, all in the name of a massive mark-up on the house price.

These things have been going on twenty years. It doesn't stem from r kings or anything you've seen on Facebook. It's not new. It's also hard to make money on them as many a GAA club found out.

ted1

They are ran out if the uk as the people don’t have a gambling license.

I imagine revenue will look for their cut, which would be USC, PRSI and PAYE. On all revenues.

Turkish1

ted1 wrote: »

They are ran out if the uk as the people don’t have a gambling license.

I imagine revenue will look for their cut, which would be USC, PRSI and PAYE. On all revenues.

Was just thinking this myself. How do the legalities/tax side of things work in cases like this?

Would the consideration on the contract be €10 (or whatever the ticket cost?)

Would the winner be subject to CGT as paying below market value for the property?

The seller - the income would be taxable right? Couldn't claim they sold the house for the total proceeds (and claim PPR relief etc..) as only one person buying the house for the price of one ticket? So basically all proceeds taxable?

callaway92

I know it's not new - but definitely for John Doe putting his house up himself for Raffle is definitely new. The addition of Social Media to that ramps it up then.

Claw Hammer

A licence or permit is needed. there was a spate of it in the 1980s which stopped when some promoters were prosecuted.
Gaming and Lotteries Act, 1956

21.—(1) No person shall promote or assist in promoting a lottery.

(2) No person shall import, print, publish or distribute or sell, offer or expose for sale, invite an offer to buy or have in his possession for sale or distribution any ticket, counterfoil or coupon for use in a lottery or any document containing any information relating to a lottery.

(3) If any ticket, counterfoil or coupon for use in a lottery is found at any place or premises searched in pursuance of a search warrant under this Act, it shall be evidence until the contrary is proved, in a prosecution for a contravention of this section, that the person having control over the place or premises had it in his possession for sale or distribution.

(4) This section does not apply to a lottery declared by any provision of this Part not to be unlawful.

(5) This section does not apply to the printing of tickets, counterfoils, coupons or other documents for the promoters of a lottery promoted and conducted wholly outside the State.

I was wondering what happened with the one in Belcamp being raffled and looking at the website the draw isn't happening until they sell 40,000 tickets at 20 a pop = 800,000 :eek: Those houses are about 450k at most.

I love the way they didn't mention Belcamp anywhere in the information but describe the house location as

"The lucky winner will win a 3 storey, 4 bed, 3 bathroom home all over 135sqm with a south facing back garden in Dublin located close to Dublin Airport, 5 minutes from Portmarnock and 10 minutes from Dublin’s most popular seaside towns of Howth and Malahide."

One for sale for 450,000
https://www.myhome.ie/residential/brochure/5-belcamp-manor-balgriffin-dublin-13-d17-p860/4489714

"As soon as the 40,000 tickets are sold the winner will be notified by Raffal and the proceeds will go to us and we'll be able to sort out the mortgage end, pay stamp duty and legal fees, and hand over the keys."

https://www.irishmirror.ie/lifestyle/homes-and-property/irish-couple-selling-four-bed-23650773

Caranica

Claw Hammer wrote: »

A licence or permit is needed. there was a spate of it in the 1980s which stopped when some promoters were prosecuted.
Gaming and Lotteries Act, 1956.

There's an exception in that legislation for private members draws. You set it up so that purchase of a ticket automatically makes you a member of the "I want to win this house" club or whatever and it's fine. Just need a club constitution and trustees. Lots of groups run raffles this way

Meeoow

There is one in Donegal that keeps popping up on my Facebook. A tenner a ticket, there were 150000 tickets originally. So they could have taken in 1.5 million euros. That is some profit for them. They have reduced the number to 70000 tickets, which is still miles over the value of the house. They are at the same spiel, pulling on people's heartstrings by making a donation to Beaumont.
I think you have to answer a simple question when you purchase a ticket, to get round the raffle licence.

SweetCaliber

Meeoow wrote: »

I think you have to answer a simple question when you purchase a ticket, to get round the raffle licence.

Pretty sure that's UK law only, Irish law doesn't seem to make note of this.

ted1

SweetCaliber wrote: »

Pretty sure that's UK law only, Irish law doesn't seem to make note of this.

It’s Irish law.

KevRossi

Depends on how it's done. Roscommon GAA supporters group, Club Rossie raffled an apartment in London. Valued at €800,000, they made €900,000 clear profit on it. Paid about €250,000 for advertising alone. They have the advantage that they had supporters all over the world selling tickets for them in Irish clubs, GAA clubs, Irish pubs etc. It was professionally run, they had people volunteering their services who have experience of advertising as well as accountants, so that worked out OK for them.

Also ran a 'Win a House in Dublin' competition a couple of years ago that got them €950,000 profit. House was worth €420,000.

https://roscommonherald.ie/2020/12/30/profit-of-over-e900000-for-roscommon-gaa-from-win-a-home-in-london-draw/

SweetCaliber

ted1 wrote: »

It’s Irish law.

Any chance you could link to it, I've been looking to set up an r King's style setup but couldn't find anything in Irish law about chance or element of skill.

Plenty in the UK law about it though.

Cheers!

SusanC10

Say I enter one of these Draws and win the house but I don't want to live in it and so I sell it and use the proceeds to put towards a different house in my preferred location.

What kind of taxes will I pay in the above scenario ?

Claw Hammer

Caranica wrote: »

There's an exception in that legislation for private members draws. You set it up so that purchase of a ticket automatically makes you a member of the "I want to win this house" club or whatever and it's fine. Just need a club constitution and trustees. Lots of groups run raffles this way

Private draws can't be advertised.

ted1

SweetCaliber wrote: »

Any chance you could link to it, I've been looking to set up an r King's style setup but couldn't find anything in Irish law about chance or element of skill.

Plenty in the UK law about it though.

Cheers!

You’ll need to spend money on a lawyer if you want to set up a business.
Your defence in court can’t be “someone on boards said so”

Further details here : https://www.lexology.com/library/detail.aspx?g=99b3a240-b502-4580-9e02-c13e67a719e5

Effectively it has to be a skill rather than chance ( gamble /bet,etc) you also need free entrants.


https://www.lexology.com/library/detail.aspx?g=99b3a240-b502-4580-9e02-c13e67a719e5

I do know someone who setup a system in Ireland.

https://winbigcompetitions.ie/?gclid=CjwKCAjw9r-DBhBxEiwA9qYUpbmtw6EMFfvvos3QLXPJI930_QYcowEKD9Vl4x3LA0u3_jFjOm7gLRoC2u0QAvD_BwE

L1011

callaway92 wrote: »

I know it's not new - but definitely for John Doe putting his house up himself for Raffle is definitely new. The addition of Social Media to that ramps it up then.

It was relatively common in Ireland in the 1980s - so its not new, its just back, decades later.

Back then it was sometimes the only way to shift a house in certain areas for what was owed on it; or at all. Semi-common scenario was a couple who both already had houses marrying, I know of one in Ashbourne that was raffled for that reason.

Caranica

Claw Hammer wrote: »

Private draws can't be advertised.

True but tickets are printed/published in order to be purchased.

callaway92

L1011 wrote: »

It was relatively common in Ireland in the 1980s - so its not new, its just back, decades later.

Back then it was sometimes the only way to shift a house in certain areas for what was owed on it; or at all. Semi-common scenario was a couple who both already had houses marrying, I know of one in Ashbourne that was raffled for that reason.

Right. Well now I see it being very common and purposefully a money spinner disguised as some guff competition

Claw Hammer

Caranica wrote: »

True but tickets are printed/published in order to be purchased.

That doesn't make it legal.

MrMusician18

KevRossi wrote: »

Depends on how it's done. Roscommon GAA supporters group, Club Rossie raffled an apartment in London. Valued at €800,000, they made €900,000 clear profit on it. Paid about €250,000 for advertising alone. They have the advantage that they had supporters all over the world selling tickets for them in Irish clubs, GAA clubs, Irish pubs etc. It was professionally run, they had people volunteering their services who have experience of advertising as well as accountants, so that worked out OK for them.

Also ran a 'Win a House in Dublin' competition a couple of years ago that got them €950,000 profit. House was worth €420,000.

https://roscommonherald.ie/2020/12/30/profit-of-over-e900000-for-roscommon-gaa-from-win-a-home-in-london-draw/

Club rossie London raffle is an interesting case. Yes they made a good profit but they nearly made as much on the house in Dublin that raffled and was lower risk. From the size of the draw it looks like they hoped to make about three times as much as they did. I'd say when all's done and dusted, they were disappointed with the return.

What didn't help was that they fell foul of UK lottery laws and had to refund all UK entries

Caranica

Claw Hammer wrote: »

That doesn't make it legal.

I know of some national ones that have been going for decades, the small print on the tickets says something like "there shall be no further announcements or advertisements in relation to this draw". Further being the key word.

Claw Hammer

Caranica wrote: »

I know of some national ones that have been going for decades, the small print on the tickets says something like "there shall be no further announcements or advertisements in relation to this draw". Further being the key word.

How does that make them legal?

Caranica

Claw Hammer wrote: »

How does that make them legal?

Same one would have been scrutinised heavily by the media over the years so I presume the organisation had had the terms reviewed by legal professionals.

Claw Hammer

Caranica wrote: »

Same one would have been scrutinised heavily by the media over the years so I presume the organisation had had the terms reviewed by legal professionals.

You are assuming! If a club formed for some other purpose e.g sports has a private lottery, that is one thing which may be legal as a porivate lottery, but if the purpose of the club is solely for the purpose of the lottery, it is illegal.
Just because you have seen something happen does not necessarily mean that it is legal or if it is legal that tghe same model can be transposed into another situation and still be legal.

KevRossi

MrMusician18 wrote: »

Club rossie London raffle is an interesting case. Yes they made a good profit but they nearly made as much on the house in Dublin that raffled and was lower risk. From the size of the draw it looks like they hoped to make about three times as much as they did. I'd say when all's done and dusted, they were disappointed with the return.

What didn't help was that they fell foul of UK lottery laws and had to refund all UK entries

€750,000 profit on the London apartment was the desired target, they got €903,000. Hardly disappointing and an enormous achievement for a relatively small county, population wise. I think €230,000 had to be returned to the UK, but some of those people then purchased tickets through people resident here.

Target over the two draws was to clear the full debt and have money to invest in the new Centre of Excellence. Target was achieved; €1.85m net profit over the two draws.

NIMAN

Meeoow wrote: »

There is one in Donegal that keeps popping up on my Facebook. A tenner a ticket, there were 150000 tickets originally. So they could have taken in 1.5 million euros. That is some profit for them. They have reduced the number to 70000 tickets, which is still miles over the value of the house. They are at the same spiel, pulling on people's heartstrings by making a donation to Beaumont.
I think you have to answer a simple question when you purchase a ticket, to get round the raffle licence.

I was tempted to buy a ticket for the Donegal one myself, as I live in the county and it was only a tenner.

But 5% to the hospital? Poor slice if they are that thankful for their help in looking after their parents.

As said, it looks like using the hospital to help sell tickets.

Meeoow

NIMAN wrote: »

I was tempted to buy a ticket for the Donegal one myself, as I live in the county and it was only a tenner.

But 5% to the hospital? Poor slice if they are that thankful for their help in looking after their parents.

As said, it looks like using the hospital to help sell tickets.

I was tempted too, would like a house in God's county! But I don't like the way they are trying to come across as if they are philanthropists, giving someone a house and donating to charity.
If they had limited the ticket numbers to something more realistic, I would have bought one.

callaway92

NIMAN wrote: »

I was tempted to buy a ticket for the Donegal one myself, as I live in the county and it was only a tenner.

But 5% to the hospital? Poor slice if they are that thankful for their help in looking after their parents.

As said, it looks like using the hospital to help sell tickets.

That’s exactly the point I was trying to make in my OP and a guy berated me saying ‘ suspect the mentioned charities would gratefully appreciate any funds raised’ haha. It’s a scummy tactic. As if the person running the raffle gives a ****e about the charity. It’s a cover mechanism for a massive net gain.

See this guff? ‘Single Mom’ - Why that’s needed to be mentioned I do not know. Another one where a ‘percentage’ is going to charity.

https://twitter.com/dawncusack4/status/1379214118314459141?s=21

Caranica

Spotted that one as it's a promoted tweet on Twitter. Tickets £10 each so will work out at more than €11 and there are 60,000 available. No way that house is even worth €300k. Even with 5% going to charity there's a potential for a massive profit. One media outlet has picked it up and framed it as a kind thing to do. Like wtf??

Browney7

Caranica wrote: »

Spotted that one as it's a promoted tweet on Twitter. Tickets £10 each so will work out at more than €11 and there are 60,000 available. No way that house is even worth €300k. Even with 5% going to charity there's a potential for a massive profit. One media outlet has picked it up and framed it as a kind thing to do. Like wtf??

Isn't the charity piece not just a licencing/legal dodge to get around lottery laws?

Kashmir21

Reading this thread and just thought I'd throw this out there...

I know a guy who ran the social media campaign for one of these 'Win a House' competitions a few years back. When the ticket selling was nearing complete, he was able to see (via back-end access to the web shop) that a huge majority of tickets were still not sold. So with this knowledge he hedged his bets and got his wife and presumably family members to buy 5, maybe 10x tickets which would obviously increase their odds of winning. And as luck would have it when the draw was made, his wife was the lucky ticket that was pulled out!!! The house was valued at €285,000 and they cashed it all in (tax free) for the financial equivalent. I still to this day cannot believe that the GAA club running the competition, did not spot this and call it out as a conflict of interest. But there you have it, that's what you're up against with these competitions.

whomitconcerns

https://www.boards.ie/discussion/comment/118284489#Comment_118284489

Ok., if you say so

Claw Hammer

https://www.boards.ie/discussion/comment/118284489#Comment_118284489

What would Ireland be without its cute hoors?

callaway92

One Raffle that I flagged at the earlier in the thread based in Limerick didn’t come near it’s total I think. Cash prize of 60k was given instead of house.

1) Did the nominated charity still get its funds?

2) Did the creator of the raffle get something?

3) Obviously Raffal would’ve taken a cut too

*the total prize given to the ‘winners’ if I remember right is 75* of whatever was raised

Caranica

I saw on the Irish Motor Neurone Disease association that a raffle a house draw they were affiliated with has been cancelled. Someone won a cash prize and the association got a miserly €1000 euro.

callaway92

https://www.boards.ie/discussion/comment/118286446#Comment_118286446

Grim

These leeches using charities as a ‘pull’ for the raffles really piss me off. Almost using them as a sympathy vote at times.

Darc19

https://www.boards.ie/discussion/comment/118286417#Comment_118286417

If it's run by raffl, then it follows a process.

Basically if you don't sell enough tickets raffl get their fee, the rest is given as prize and charity and any costs are yours to bear.

So it's not the win win people think and many people are wise to these draws.

Different if you know that the funds go to a local gaa club or other good cause.

Kashmir21

https://www.boards.ie/discussion/comment/118285736#Comment_118285736

Do you not believe me?

This is the absolute truth. Few people know about it and the club obviously thought it was kosher enough to allow, but it's a definite conflict of interest in my opinion.

Caquas

https://www.boards.ie/discussion/comment/118288787#Comment_118288787

This is not a conflict of interest. He bought a lot of tickets because he saw they were good value. What’s wrong with that? It could be “insider trading” if the information was kept hidden but whose fault was that? The problem is that the club must have lost money I.e. the total ticket sales were less than the value of the prize (the house).

https://www.boards.ie/discussion/comment/116834571#Comment_116834571

Four takeaway coffees for ten euro lol ...try 16 euro at a mimium

callaway92

https://www.boards.ie/discussion/comment/118296140#Comment_118296140

I don’t think I’ve seen a coffee (americano anyway) cheaper than €2.50 other than McDonalds/Sol

On the flip side, not sure what kinda rip-off €4 coffee you’re getting

Latte, capichino ect

callaway92

https://www.boards.ie/discussion/comment/118296889#Comment_118296889

Fairly sure so that you picked on the guys’ comment for no reason so. He hardly meant lattes and cappuccinos ffs

Kashmir21

https://www.boards.ie/discussion/comment/118296069#Comment_118296069

Generally speaking immediate family members are not allowed to enter in to competitions, where there is a direct connection to running the competition. Add to this, the fact that they had inside knowledge on ticket sales which they potentially used to their advantage. Or maybe it was just complete luck... 😉

https://www.boards.ie/discussion/comment/118296889#Comment_118296889

being a bit of a c u next Tuesday tbh. “Um akshually you can only get 1 and a half skinny iced frappes from Starbucks for €10, mate.”

coffee is coffee and I can promise you without a doubt there’s many a location to buy a takeaway coffee for €2.50 or less. As if that really matters anyway…